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Foreign politicians constantly talk about the importance of creating a public broadcasting service in Ukraine, while Ukrainian politicians nod and agree in response. But when it comes to the distribution of the budget for 2016, there is not enough money once again. MYMEDIA decided to find out why it was happening, how it would affect the work of the PBS and how to survive with a budget that is half of what was promised.

Why wasn’t there enough money?

According to a law that was supported by 256 deputies in March 2015, the Public Broadcasting Service (PBS) must receive at least 0.2% of the general fund of the state budget. Based on the estimates by Ihor Rozkladay, a lawyer at the Media Law Institute, we are talking about 1.1 billion Hryvnia. However, instead of giving this money, the Ministry of Finance has allocated a sum which is half as much; thus, UA: 1st channel and its regional network received 654.2 million.

 

Уточнено. 654 231 600 грн. Ось бюджет суспільного мовлення на цей рік. Це 0,1%. Ще 92 713 700 має заробити мають самос...

Posted by Igor Rozkladaj on Tuesday, January 5, 2016

 

Rozkladay himself is not very surprised by this. “The Ministry of Finance simply copies the articles from year to year. If you look at the budgets of the State Committee for Television and Radio Broadcasting in recent years, the amount is about the same,” he says.

The other reason for underfunding is that the PBS exists only on paper and officially still belongs to the state; it will not be registered as a separate legal entity before spring 2016. This is why the budget for  UA: 1st  is included in the section “State Committee for Television and Radio Broadcasting” of the state budget. "Accordingly, there is no reason to talk about a violation of the law. If there is no legal subject, then there is no money," explains Rozkladay.

Zurab Alasania, the general director of UA: 1st explains the lack of funding with the fact that the state simply has no funds. So the channel was given what could be afforded.

"They are not monsters who in a political sense are against the existence of the PBS. They are just people who do not care whether they finance the PBS or something else."

Alasania is positive that later the budget will be revised, so the PBS will receive its funding. "It happens every year: in the first month, we get half the budget so it is enough to survive and work. Then, after the first quarter, the revenues arrive,” he adds.

The difference between the words and actions of Ukrainian politicians no longer surprises anyone.  Zurab Alasania believes that the politicians were just pretending to be interested in creating a PBS to look better in the eyes of Western partners. After all, the European Union and the Council of Europe called the launch of the PBS a must without which the implementation of the Association agreement with Ukraine would not be possible. The EU delegation in Kyiv, along with many international donors, repeatedly insisted on reforms to UA: 1st.

"For Western politicians, the value of a public broadcasting system is fundamental, and there already exists a working and organized system. Our politicians, on the other hand, were simply playing their roles

At the end of the day, it turned out that there were other equally important unfunded areas, such as medicine."

Ihor Rozkladay calls the promises of "golden mountains" indicative of Ukrainian politics and an established tradition. According to him, politicians promise general concepts, but they cannot handle the details because very few of them have carefully studied the documents.

"I am convinced that only those deputies who are somehow connected with media sphere know the financing details of the PBS. Others are unlikely to even know how much money was supposed to be given, nor how much was actually allocated."

Svitlana Ostapa, a journalist at Media Sapiens and a key expert on public service broadcasting in Ukraine, agrees that politicians know little about the intricacies and difficulties of establishing public broadcasting. "They need to be reminded about it constantly. At a press conference, I urged speaker of the Verkhovna Rada, Volodymyr Hroysman, to comply with the law on PBS in terms of it's funding once established. At that time, he promised to take the needs of the PBS into account during further budget discussions."

According to Rozkladay, from the Media Law Institute, there is a possibility to extend the budget, but only based on personal agreements with the Ministry.  There are, however, no legal measures one can use to influence the budget. 

 

Igor Rozkladaj, the lawyer of the Media Law Institute
Igor Rozkladaj, the lawyer of the Media Law Institute. Photo - 24tv.ua
 

What could be done now?

Alasania, General director of "UA:1st, is convinced that underfunding will not affect the quality of the materials in any way. He is positive that the money will come later, and the conditions will soon improve. "Sometime in April, or in the worst case, July, we will become a public company. It will change our ability to control available resources. As long as we belong to the state, we cannot redirect money independently for such things as, for instance, production – even though the state did not provide any funds for it."  [Most of the new and innovative programs on UA: 1st, as well as the majority of the training sessions for journalists, have so far been paid for by foreign donors - Ed].

There is also the possibility to obtain funds from sources other than the state budget. According to Rozkladay, the law enables the PBS to seek funds from sources such as advertising, foreign donors and even a monthly subscription fee.

At the moment, it is best to rely primarily on donors. And they, according to Alasania, are willing to help. In 2016, he is hoping for two major projects to be supported by the Japanese and European donors.

One of them will allow the team to start new programs including political and entertaining talk shows. The other one will help to build a large convergent newsroom in the style of BBC and other Western public service broadcasters (a business plan for the creation of which was sponsored by MYMEDIA).

Alasania stated that the European Union was ready to give money for its construction, and it would cost around 5 million Euros

At the moment, there are negotiations with Brussels, and the construction itself will begin sometime in the middle of the year.

There is another project planned with donors to create a training centre for journalists. Its main goal will be to improve the level of the employees at UA: 1st , and around the third year of its existence, there is a possibility it will open up for the other Ukrainian journalists (but for them, it may be on a commercial basis). In the future, this centre will be responsible for deciding which of the current employees will keep their jobs, and who will be laid off.

" UA: 1st has 1380 employees but there are only 70-80 people who actually do something. The majority still believe that this work exists for them, and not the other way around. Everything will change after the certification; then, we will give everyone the opportunity to retrain. Those who are able to work in a new way (for example, instead of a camera, they should film with iPhones) will remain. The rest will have to go," says Alasania.

Negotiations on this project have just started and we are moving through the obstacles. Zurab states: «Deutsche Welle wants to organize some workshops for us that will teach our journalists how to work with certain tools. However, we do not have those tools, and nobody is going to bring the equipment just for one training.  We are trying to convince them that they have to approach this challenge systematically and create a training centre.” The first trainings are planned for this year already. In the future, if Deutsche Welle will support the project, the EU has promised to help as well.

While UA: 1st  remains state property, it is extremely difficult to attract international investment. After all, the money they provide automatically goes to pay the debts of the National Television Company that remain from previous years. "All the money that we receive or earn goes into the treasury. And the treasury sends the funds to cover the debts without bothering to ask us. This undermines the donors’ trust," adds Alasania.

 
Zurab Alasania, general director of UA:First
Zurab Alasania, general director of UA:First. Photo - 1tv.com.ua
 

Alasania says that donors are still eyeing up everything; they think that Ukrainian politicians are strange and can change their minds at any time. Therefore, the donors do not give large sums yet. UA: 1st opened a Support Fund for Public Broadcasting in order to work with them. This fund is independent from the National Television Company.

According to Ihor Rozkladay, the PBS also has a "reserve" for raising finances. If it fails to get the additional funds from the state, or if the international donors do not come through with enough help, the channel can sell some of its properties. But this procedure is difficult and unpleasant. "To sell things, the channel has to prepare a list of sites with the addresses, and then, it has to pass it through the entire Parliament. And even then, selling property is not very realistic taking into consideration the current economic conditions on the property market. "

How are foreign broadcasters being funded?

According to the experts, even 0.2% of the state budget is not enough to establish a European-style PBS. "We tried to include a more or less realistic amount into the law given the current conditions. Western experts believe that the Ukrainian PBS requires twice as much. We agree, but we also understand that that kind of money we simply will not get," says Ihor Rozkladay, adding that in a few years, this amount will still have to be revised.

In Europe, PBSs do not always receive funding from the state: "In the Netherlands, they moved to a system of public financing because it turned out to be less expensive. The two Danish Public Broadcasting channels have different financing models: DR has no advertising and receives 100% of its funds from licenses, while TV2, on the contrary, is funded entirely through advertising," says Svitlana Ostapa, an expert on public service broadcasting in Ukraine.

 
Svitlana Ostapa, the key expert on PSB in Ukraine
Svitlana Ostapa, the key expert on PSB in Ukraine. Photo - medialaw.org.ua
 
However, the situation in these countries is significantly different from Ukraine. For example, the Danish PBS is watched by 68% of the audience in total. The Ukrainian PBS’s share of the audience, at the most, is 1-2%. The average figure for European PBSs is about 27%.
 
The ideal situation, according to Ihor Rozkladay, is to have diversified resources: "the best Western model is like this: about 70% of funding comes from the state, and the rest comes from other sources. But it is difficult to compare because in the West, there is no universal model of public service broadcasting. There are general principles set out in the recommendations of the Council of Europe, but each country is developing its own model taking into account its cultural and political context. "
 

Is there any good news?

Rozkladay predicts that we will need at least five years to establish the Ukrainian PBS. He notes the initial achievements of UA: 1st such as improving the quality of news, which was verified via monitoring, and the introduction of a new debate format.

"We are accustomed to emotionally charged talk shows and political trash talks with lots of populism, but without any projections. Debates on UA: 1st are conducted in a different way, because people are trying to talk in detail. They have not received high ratings yet, but this is a contribution to the development of political culture in our country " (two years after Maidan, the channel has 1-2% of the audience coverage - Ed.)

For Zurab Alasania, the main victories so far have been the signing of the law, merging almost all regional branches despite their fierce resistance, the creation of the Supervisory Board and a noticeable improvement in the quality of production. "It has become a norm that the channel has no low-quality materials, but you wouldn’t believe the effort we have had to make to achieve that,” he says.

"Any change in the National Television Company of Ukraine has to be approved by 8 ministries. And a change in any of these ministries means the entire process start again from the beginning. This work might not be visible to the outside, but it had to be done – and it has been done. "

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Foreign politicians constantly talk about the importance of creating a public broadcasting service in Ukraine, while Ukrainian politicians nod and agree in response. But when it comes to the distribution of the budget for 2016, there is not enough money once again. MYMEDIA decided to find out why it was happening, how it would affect the work of the PBS and how to survive with a budget that is half of what was promised.

Why wasn’t there enough money?

According to a law that was supported by 256 deputies in March 2015, the Public Broadcasting Service (PBS) must receive at least 0.2% of the general fund of the state budget. Based on the estimates by Ihor Rozkladay, a lawyer at the Media Law Institute, we are talking about 1.1 billion Hryvnia. However, instead of giving this money, the Ministry of Finance has allocated a sum which is half as much; thus, UA: 1st channel and its regional network received 654.2 million.

 

Уточнено. 654 231 600 грн. Ось бюджет суспільного мовлення на цей рік. Це 0,1%. Ще 92 713 700 має заробити мають самос...

Posted by Igor Rozkladaj on Tuesday, January 5, 2016

 

Rozkladay himself is not very surprised by this. “The Ministry of Finance simply copies the articles from year to year. If you look at the budgets of the State Committee for Television and Radio Broadcasting in recent years, the amount is about the same,” he says.

The other reason for underfunding is that the PBS exists only on paper and officially still belongs to the state; it will not be registered as a separate legal entity before spring 2016. This is why the budget for  UA: 1st  is included in the section “State Committee for Television and Radio Broadcasting” of the state budget. "Accordingly, there is no reason to talk about a violation of the law. If there is no legal subject, then there is no money," explains Rozkladay.

Zurab Alasania, the general director of UA: 1st explains the lack of funding with the fact that the state simply has no funds. So the channel was given what could be afforded.

"They are not monsters who in a political sense are against the existence of the PBS. They are just people who do not care whether they finance the PBS or something else."

Alasania is positive that later the budget will be revised, so the PBS will receive its funding. "It happens every year: in the first month, we get half the budget so it is enough to survive and work. Then, after the first quarter, the revenues arrive,” he adds.

The difference between the words and actions of Ukrainian politicians no longer surprises anyone.  Zurab Alasania believes that the politicians were just pretending to be interested in creating a PBS to look better in the eyes of Western partners. After all, the European Union and the Council of Europe called the launch of the PBS a must without which the implementation of the Association agreement with Ukraine would not be possible. The EU delegation in Kyiv, along with many international donors, repeatedly insisted on reforms to UA: 1st.

"For Western politicians, the value of a public broadcasting system is fundamental, and there already exists a working and organized system. Our politicians, on the other hand, were simply playing their roles

At the end of the day, it turned out that there were other equally important unfunded areas, such as medicine."

Ihor Rozkladay calls the promises of "golden mountains" indicative of Ukrainian politics and an established tradition. According to him, politicians promise general concepts, but they cannot handle the details because very few of them have carefully studied the documents.

"I am convinced that only those deputies who are somehow connected with media sphere know the financing details of the PBS. Others are unlikely to even know how much money was supposed to be given, nor how much was actually allocated."

Svitlana Ostapa, a journalist at Media Sapiens and a key expert on public service broadcasting in Ukraine, agrees that politicians know little about the intricacies and difficulties of establishing public broadcasting. "They need to be reminded about it constantly. At a press conference, I urged speaker of the Verkhovna Rada, Volodymyr Hroysman, to comply with the law on PBS in terms of it's funding once established. At that time, he promised to take the needs of the PBS into account during further budget discussions."

According to Rozkladay, from the Media Law Institute, there is a possibility to extend the budget, but only based on personal agreements with the Ministry.  There are, however, no legal measures one can use to influence the budget. 

 

Igor Rozkladaj, the lawyer of the Media Law Institute
Igor Rozkladaj, the lawyer of the Media Law Institute. Photo - 24tv.ua
 

What could be done now?

Alasania, General director of "UA:1st, is convinced that underfunding will not affect the quality of the materials in any way. He is positive that the money will come later, and the conditions will soon improve. "Sometime in April, or in the worst case, July, we will become a public company. It will change our ability to control available resources. As long as we belong to the state, we cannot redirect money independently for such things as, for instance, production – even though the state did not provide any funds for it."  [Most of the new and innovative programs on UA: 1st, as well as the majority of the training sessions for journalists, have so far been paid for by foreign donors - Ed].

There is also the possibility to obtain funds from sources other than the state budget. According to Rozkladay, the law enables the PBS to seek funds from sources such as advertising, foreign donors and even a monthly subscription fee.

At the moment, it is best to rely primarily on donors. And they, according to Alasania, are willing to help. In 2016, he is hoping for two major projects to be supported by the Japanese and European donors.

One of them will allow the team to start new programs including political and entertaining talk shows. The other one will help to build a large convergent newsroom in the style of BBC and other Western public service broadcasters (a business plan for the creation of which was sponsored by MYMEDIA).

Alasania stated that the European Union was ready to give money for its construction, and it would cost around 5 million Euros

At the moment, there are negotiations with Brussels, and the construction itself will begin sometime in the middle of the year.

There is another project planned with donors to create a training centre for journalists. Its main goal will be to improve the level of the employees at UA: 1st , and around the third year of its existence, there is a possibility it will open up for the other Ukrainian journalists (but for them, it may be on a commercial basis). In the future, this centre will be responsible for deciding which of the current employees will keep their jobs, and who will be laid off.

" UA: 1st has 1380 employees but there are only 70-80 people who actually do something. The majority still believe that this work exists for them, and not the other way around. Everything will change after the certification; then, we will give everyone the opportunity to retrain. Those who are able to work in a new way (for example, instead of a camera, they should film with iPhones) will remain. The rest will have to go," says Alasania.

Negotiations on this project have just started and we are moving through the obstacles. Zurab states: «Deutsche Welle wants to organize some workshops for us that will teach our journalists how to work with certain tools. However, we do not have those tools, and nobody is going to bring the equipment just for one training.  We are trying to convince them that they have to approach this challenge systematically and create a training centre.” The first trainings are planned for this year already. In the future, if Deutsche Welle will support the project, the EU has promised to help as well.

While UA: 1st  remains state property, it is extremely difficult to attract international investment. After all, the money they provide automatically goes to pay the debts of the National Television Company that remain from previous years. "All the money that we receive or earn goes into the treasury. And the treasury sends the funds to cover the debts without bothering to ask us. This undermines the donors’ trust," adds Alasania.

 
Zurab Alasania, general director of UA:First
Zurab Alasania, general director of UA:First. Photo - 1tv.com.ua
 

Alasania says that donors are still eyeing up everything; they think that Ukrainian politicians are strange and can change their minds at any time. Therefore, the donors do not give large sums yet. UA: 1st opened a Support Fund for Public Broadcasting in order to work with them. This fund is independent from the National Television Company.

According to Ihor Rozkladay, the PBS also has a "reserve" for raising finances. If it fails to get the additional funds from the state, or if the international donors do not come through with enough help, the channel can sell some of its properties. But this procedure is difficult and unpleasant. "To sell things, the channel has to prepare a list of sites with the addresses, and then, it has to pass it through the entire Parliament. And even then, selling property is not very realistic taking into consideration the current economic conditions on the property market. "

How are foreign broadcasters being funded?

According to the experts, even 0.2% of the state budget is not enough to establish a European-style PBS. "We tried to include a more or less realistic amount into the law given the current conditions. Western experts believe that the Ukrainian PBS requires twice as much. We agree, but we also understand that that kind of money we simply will not get," says Ihor Rozkladay, adding that in a few years, this amount will still have to be revised.

In Europe, PBSs do not always receive funding from the state: "In the Netherlands, they moved to a system of public financing because it turned out to be less expensive. The two Danish Public Broadcasting channels have different financing models: DR has no advertising and receives 100% of its funds from licenses, while TV2, on the contrary, is funded entirely through advertising," says Svitlana Ostapa, an expert on public service broadcasting in Ukraine.

 
Svitlana Ostapa, the key expert on PSB in Ukraine
Svitlana Ostapa, the key expert on PSB in Ukraine. Photo - medialaw.org.ua
 
However, the situation in these countries is significantly different from Ukraine. For example, the Danish PBS is watched by 68% of the audience in total. The Ukrainian PBS’s share of the audience, at the most, is 1-2%. The average figure for European PBSs is about 27%.
 
The ideal situation, according to Ihor Rozkladay, is to have diversified resources: "the best Western model is like this: about 70% of funding comes from the state, and the rest comes from other sources. But it is difficult to compare because in the West, there is no universal model of public service broadcasting. There are general principles set out in the recommendations of the Council of Europe, but each country is developing its own model taking into account its cultural and political context. "
 

Is there any good news?

Rozkladay predicts that we will need at least five years to establish the Ukrainian PBS. He notes the initial achievements of UA: 1st such as improving the quality of news, which was verified via monitoring, and the introduction of a new debate format.

"We are accustomed to emotionally charged talk shows and political trash talks with lots of populism, but without any projections. Debates on UA: 1st are conducted in a different way, because people are trying to talk in detail. They have not received high ratings yet, but this is a contribution to the development of political culture in our country " (two years after Maidan, the channel has 1-2% of the audience coverage - Ed.)

For Zurab Alasania, the main victories so far have been the signing of the law, merging almost all regional branches despite their fierce resistance, the creation of the Supervisory Board and a noticeable improvement in the quality of production. "It has become a norm that the channel has no low-quality materials, but you wouldn’t believe the effort we have had to make to achieve that,” he says.

"Any change in the National Television Company of Ukraine has to be approved by 8 ministries. And a change in any of these ministries means the entire process start again from the beginning. This work might not be visible to the outside, but it had to be done – and it has been done. "

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